The Incorporated Owners of Freder Centre v. Gringo Ltd and Another

HCMP 324/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 324OF 2015

(ON AN INTENDED APPEAL FROM LDBM NO. 290 of 2013)

_____________

_____________

___________________________________

REASONS FOR JUDGMENT

___________________________________

Hon Lam VP (giving the Reasons for Judgment of the Court):

1.In this matter, we granted leave to appeal on 17 March 2015. Under Order 59 Rule 4, the Notice of Appeal should be served within 7 days from the date when leave is granted, viz by 24 March 2015. This was not done. We have before us an application to seek extension of time to serve the Notice of Appeal. The summons was issued by solicitors for the respondents on 8 June 2015.

2.The delay is substantial.  All along, the respondents were represented by solicitors.  Mr Shea, the solicitor, accepted that it was his firm’s mistake in overlooking the deadline for the service of the Notice of Appeal.  He said the respondents had every intention to proceed with the appeal. 

3.Mr Shea only realized his firm’s mistake when solicitors for the applicant wrote to him, seeking to have the stay of execution of uplifted on the basis that the respondents were not proceeding with the appeal.

4.Mr Shea further said the mistake was caused by a change of personnel and the case had been inadvertently overlooked.  However, he did not elaborate in his affirmation on what change of personnel was he referring to and how did it contribute to the mistake.  At the hearing before us, counsel for the respondents informed us that the legal executive handling the case had left the employment of Mr Shea’s firm without property handing over it to his successor.

5.The application is opposed by Mr Koo for the applicant.  In an affidavit of the solicitor for the applicant, the solicitor asserted that it was unbelievable that the deadline for filing and serving the Notice of Appeal was overlooked for such a long period of time and the respondents had not followed up with the progress of the intended appeal in the meantime.  On that basis, he contended that the respondents had no genuine intention to proceed with the appeal and only tried to delay the matter with a stay of execution.

6.The court has a general discretion to extend time for serving a notice of appeal.  Usually, such discretion would be exercised by considering the length of the delay, the reason for the delay, the prejudice to the other party and the merits of the intended appeal, see Norwich & Peterborough Building Society v Steed [1991] 1 WLR 449.  However, in the recent judgment of this court in Real Estate Developers Association of Hong Kong v Building Authority, HCMP 1746 of 2014, 27 May 2015, it was emphasized that the exercise is a multi-facet balancing process and the discretion is a broad and flexible one, to be exercised having regard to the facts and circumstances of each case.

7.With respect, we cannot see any basis for disbelieving the evidence of Mr Shea.  He is an officer of the court and he is aware of the serious consequence of giving false evidence in his affirmation. Mr Koo could not put forward any reasonable basis for suggesting that Mr Shea would put his professional future at stake simply for the sake of the respondents. 

8.In light of the evidence of Mr Shea, as between the two of them, the blame must lie with the solicitor instead of the respondents in respect of the failure to comply with the rules.  However, generally speaking, as between parties to the litigation, a party must bear the consequence of the errors of his solicitor.  Thus, Mr Koo is entitled to say that the delay is substantial and inexcusable.

9.Even so, the court must take account of the explanation for the delay.  Having regard to the evidence of Mr Shea, it would be difficult to draw the inference that the respondents did not have any intention to pursue the appeal.  Further, this is not a case where the respondents had done nothing for the purpose of appealing.  They had applied for leave to appeal in the court below and when leave was refused, come to this court to seek leave.  According to the statement of costs lodged in the leave application, they had to incur costs in the total sum of $126,939 for these leave applications.  The subject matter of the intended appeal is the right to display signage at the external wall of a building.  Viewed in that light, such costs is a significant amount and there is no basis for suggesting that to be a small price to pay for a few months’ stay of execution without any real intention in appealing.

10.We accept that the delay was due to the inadvertent mistake on the part of the solicitor for the respondents.

11.When we granted leave, we already accepted that the intended appeal has a reasonable prospect of success.  We do not see any reason for revisiting that conclusion, see Cheung Kwong Yuen v Sun huifang HCMP 3306 of 2014, 19 May 2015.

12.The applicant said it suffered prejudice by reason of the stay.  However, the stay was granted because we were satisfied with the prospect of the appeal and that it was appropriate to grant a stay in the circumstances of the case.  Whilst the delay in serving the Notice of Appeal could have the effect of prolonging the stay (if the applicant was successful in resisting the appeal), such prejudice could be ameliorated by directing the respondents to proceed with the appeal expeditiously, including the imposition of a timetable to procure the more expeditious fixing of dates for hearing the appeal than usual. 

13.In any event, given the subject matter of the appeal, the prejudice caused by the prolongation of the stay (if any) would not be a weighty factor in the overall balancing exercise.

14.On the whole, we are satisfied that this is a proper case to grant extension of time to the respondents to file and serve the Notice of Appeal by tomorrow on condition that the respondents shall proceed with the appeal expeditiously and apply for the fixing of the hearing date of the appeal by 15 July 2015.

15.The Solicitor for the respondents undertook to bear the costs of all the parties in this application.  In the circumstances, we do not need to make any order for costs apart from fixing the costs of the applicant at $34,570.

Mr Ernest Koo, instructed by Huen & Partners, for the applicant

Mr Paul Wu, instructed by Damien Shea & Co, for the respondents